The crude oil prices have been on the rise. The automotive manufacturers decided to hike up the prices of their offerings owing to increasing material cost. And now, it is the turn of the financial institutions to play the party trick.
The increase in the prices from the OEM’s side have been in the region of Rs4,000 to Rs18,000. Honda is going to follow suit with a hike of around 10,000 rupees. And now the banks have announced that they increasing the interest rates. The percentage hike has however not been disclosed by many.
This increase in interest rates is primarily due to the hike in cash reserve ratio that was announced by RBI. The increase in interest rate will burden the customer further by approximately Rs3,600 per lakh for a loan of five years. More the loan amount, bigger the hole in the pocket.
ICICI Bank has already announced an increase of 0.75 percent and the rate now fluctuates between 14.5 to 15 percent as against 13.5 to 14.25 percent previously. The passenger car market has been experiencing a steady and healthy growth so the demand will always be there, although the growth margin may decline slightly from the 12% that the segment grew by, in March. Banks stand to make merry all the way and us customers will bear the brunt by shelling out more from our pockets.
